Page 7 - Aruba Today

U.S. NEWS A7
Friday 18 September 2015

US Financial Front:

America’s homebuilding slows in August after hot streak

JOSH BOAK A builder works on the site of the Landmark community, a group well below the standard entering the housing mar-
AP Economics Writer of condos and townhouses built by Lennar Homes, in Doral, Fla. level of six months usually ket, they’re renting longer
WASHINGTON (AP) — Build- The Commerce Department reported on U.S. home construction seen in a healthy market. before buying, held back
ers broke ground on fewer in August on Thursday, Sept. 17, 2015. This shortage has led to ris- by student debt and a lack
houses and apartment ing prices for new and ex- of down payment savings.
complexes in August, a (AP Photo/Lynne Sladky) isting homes. The share of the country
possible sign that the hous- At the same time, medi- owning homes has tum-
ing market may be level- Confidence among build- the reading was higher was an rental prices are rising bled to 63.4 percent, the
ling off after accelerating ers is also improving. October 2005 at 68. annually at 4.2 percent lowest level in 48 years.
for much of the year. The National Association of New construction has yet — roughly double the in- “People are delaying own-
Housing starts last month Home Builders/Wells Fargo to fully satisfy demand, a crease in average hourly ership until they’re on a
fell 3 percent to a season- builder sentiment index re- sign that further building will wages — because of an more solid ground — per-
ally adjusted annual rate leased Wednesday rose likely remain profitable. influx of downsizing baby sonally and professionally,”
of 1.13 million homes, the this month to 62, up from Only 5.2 months’ supply of boomers and millennials Hart said.
Commerce Department 61 in August. The last time new homes is listed for sale, entering the job market. But there are also signs of
said Thursday. Construc- The rental demand is com- limits to how far housing
tion activity slowed sharply ing in part because the activity can expand.
in the Northeast and Mid- United States will add the The lack of supply has
west last month, edged equivalent of Illinois’ popu- caused prices to shoot up
downward in the West and lation — 12.9 million people in many of the largest job
climbed in the South. — to the housing market markets, reducing afford-
Still, homebuilding appears in the next five years, said ability for potential buyers
much stronger than a year Robert Hart, chief execu- and renters. And sales at
ago, despite figures that tive of TruAmerica, a Los furnishers and building sup-
can be highly volatile on Angeles-based firm that ply stores fell in August after
a monthly basis. Construc- renovates and manages posting gains over the past
tion slowed in part due to apartment buildings. 12 months, the government
the expiration of tax incen- As younger Americans are reported Tuesday.q
tives for developers in New
York.
“This is a mere blip on the
radar,” said Tom Wind, ex-
ecutive vice president of
home lending at EverBank.
“The housing market’s un-
derlying fundamentals re-
main on pace for contin-
ued recovery.”
Housing starts have
climbed a solid 11.3 per-
cent this year to date.
Steady job gains of 2.9 mil-
lion in the past 12 months
are contributing to in-
creased demand from
buyers and renters. And
as the recovery from the
Great Recession has en-
tered its seventh year, resi-
dential construction has
stated to both reflect and
fuel broader economic
growth. Developers see
favorable demographics
helping to sustain demand,
as approved permits rose
3.5 percent in August to an
annual rate of 1.17 million.